This Week in CQ Researcher

Financial Crisis by Kenneth Jost, May 9, 2008
Did lax regulation cause a credit meltdown?

Investment banks in the United States and elsewhere are taking billion-dollar losses as they are forced to revalue their holdings. The flood of subprime mortgage defaults roiling the U.S. housing market is also feeding a worldwide credit crisis.

The U.S. Treasury Department has proposed a major overhaul of financial-markets regulation, but the sweeping plan offers little by way of immediate relief. In any event, any proposals for additional regulation will face stiff resistance from the financial community.

Should the Federal Reserve be given more power to prevent financial crises?

Should regulation of commercial banks and investment firms be tightened?

Should the markets for credit derivatives be more closely regulated?

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